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[1995] ZASCA 66
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S v Capo (383/92) [1995] ZASCA 66 (30 May 1995)
CASE NO
: 383/92 NvH
IN THE
SUPREME COURT OF SOUTH AFRICA
(APPELLATE DIVISION)
In the matter between
ANGELO CAPO
Appellant
and
THE STATE
Respondent
CORAM
: SMALBERGER,VIVIER,et HOWIE, JJA
CASE NO
: 383/92 NvH
IN THE SUPREME COURT OF
SOUTH AFRICA (APPELLATE DIVISION)
In the matter between
ANGELO CAPO Appellant
and
THE STATE
Respondent
CORAM
: SMALBERGER, VIVIER, et HOWIE, JJA
HEARD
: 22 MAY 1995
DELIVERED
: 30 MAY 1995
JUDGMENT
SMALBERGER, JA:-
The appellant and a co-accused, one Hempel, were convicted of two counts
of fraud in the Johannesburg Regional Court. They were sentenced
to eight and
four years imprisonment respectively.
2
Half of the appellant's sentence was conditionally
suspended, one of the conditions being that he compensate Volkskas Bank in the
amount of R25 000-00 plus interest. The whole of Hempel's sentence was
suspended. The appellant's appeal to the Witwatersrand Local
Division against
his conviction and sentence was unsuccessful save for the fact that the
condition relating to payment of compensation
was deleted. The appellant now
appeals to this Court, with the necessary leave, against his conviction and
sentence.
The two counts of fraud related to a scheme which involved,
inter
alia
, the establishment of a close corporation, Towerline Construction CC
("Towerline"); the opening of a bank account in its name; the
unauthorised
acquisition of cheques made out to other corporations or businesses; the
depositing of such cheques into Towerline's
bank account; and the withdrawal of
monies from such account once it had been credited with the value of the
cheques.
3
The main issue on appeal is whether it was
established at the trial that the appellant was involved in the planning and
execution
of this fraudulent scheme.
The following facts are either common cause or not in dispute for the
purposes of the present appeal. During the early 1980's the
appellant owned and
operated a construction company, Minardi Civil Contractor (Pty) Ltd ("Minardi").
Towards the end of 1984 Minardi
found itself in financial difficulties and it
was liquidated in 1985. Sometime thereafter the appellant, who is Italian by
birth,
went to Italy where he stayed until his return to South Africa in July
1987. After his return he was in contact with Hempel, with
whom he was well
acquainted. They had previously worked together for a company, Bramley
Earthworks, and subsequently Hempel had been
employed by Minardi.
On 24 June 1987 (prior to the appellant's return to South Africa) Hempel
opened a savings account in his name with a branch
4
of the Trust Bank in Pretoria. Towerline was
formed and registered by Hempel (as its sole member) on 12 August 1987. There is
no direct
evidence (apart from that of Hempel) linking the appellant with its
formation and registration. On 14 August 1987 the appellant and
Hempel went to
Volkskas Bank in Johannesburg to open a current account in the name of
Towerline. They were attended to initially
by a Mrs Roos, who obtained the
required details from them, before being introduced to the branch manager, a
certain Ferreira. On
3 September 1987 Hempel opened a current account in his
name with the First National Bank in Hillbrow. And on 9 September he opened
a
savings account with a branch of the Trust Bank in Johannesburg.
On 29 September 1987, at the head office of the Electricity Supply
Commission ("ESCOM") in Johannesburg, in keeping with an established
practice,
month-end cheques were distributed to subcontractors of ESCOM who called or sent
for them. Control at the
5
time was incredibly lax, and pre-prepared crossed
cheques and advice notices which had been placed in envelopes, were simply
handed
over to anyone claiming to be there on behalf of a subcontractor without
proof of identity or acknowledgement of receipt, a system
which clearly lent
itself to abuse. In the early afternoon a man (whom the State claims was the
appellant) arrived and asked for
the cheque due to Sieva (Pty) Limited
("Sieva"). After a short delay, while a search was conducted for it, an envelope
containing
a cheque for R17 395 862-97 in favour of Sieva was handed over to
him. A while later another man came to claim the money due to Powerlines
(Pty)
Limited ("Powerlines"). He was given an envelope containing three cheques for
R219 745-66, R654 794-39 and R4 127 910-68 respectively
made out to Powerlines
or "Powerlines Consortium". It was only when the authorised representatives of
Sieva and Powerlines arrived
later that same day to collect their cheques that
it was discovered that they had been
6
handed over to unauthorised persons. Immediate steps were taken to stop
payment of the cheques.
On the afternoon of 29 September Hempel
deposited the Powerlines cheque for R219 745-66 into the Towerline account at
Volkskas Bank.
The teller accepted the cheque not noticing the difference
between Powerlines and Towerline. On the same afternoon Hempel managed
to
deposit the Powerlines cheque for R654 794-39 into his current account with
First National Bank. The Sieva cheque and the largest
of the Powerlines cheques
were not deposited and have never been traced. On 30 September 1987 Hempel
separately deposited two cheques,
for R45 000-00 and R48 000-00 respectively,
drawn in his favour by Towerline, into his account with the Trust Bank and
requested
a special clearance for each deposit. On the same day he cashed a
Towerline cheque for R25 000-00, made out to cash, at Volkskas
Bank. The
computer showed the Towerline account to be in credit; the fact that
payment
7
had been stopped on the cheque deposited the
previous day had presumably not yet filtered through the system. Hempel was
arrested
the following day when he attempted to cash a further cheque for R50
000-00 at Volkskas Bank. Ultimately the only loss suffered was
the R25 000-00
paid out by Volkskas Bank.
On 6 October 1987 Hempel made a detailed statement to a commissioned
police officer admitting his role in the fraudulent scheme. In
it he identified
a certain Wille as the prime mover and brains behind the scheme. The statement
did not implicate the appellant in
any way. (The admissibility of the statement
was challenged at the trial. It was held to have been freely and voluntarily
made by
Hempel despite his claim and evidence to the contrary.) On 24 February
1988 Hempel made a further statement to a magistrate in Johannesburg.
It
proceeded along the same lines as his earlier statement but assigned to the
appellant the role previously ascribed to Wille. No
mention whatsoever was made
of
8
Wille. Hempel basically stuck to this version when
giving evidence at the trial. He claimed to have acted throughout on the
instructions
of the appellant, the architect of the fraudulent scheme. (Hempel
was found by the trial magistrate to be a blantantly untruthful
witness on whose
evidence no reliance could be placed in the absence of corroboration.) The
appellant, notwithstanding the evidence
implicating him in the commission of the
offences, failed to testify.
The appellant was identified by the State witness, Mrs Bagley ("Bagley"),
as the person who collected the Sieva cheque from ESCOM
on 29 September 1987.
Her honesty as a witness was not challenged. Any claim that she might have been
biased is totally without foundation.
The crux of the appeal relates to the
reliability of her identification. It was conceded by the appellant's counsel
that if Bagley's
evidence was correctly accepted by the trial magistrate the
appeal had to fail, as the combined effect of the
9
appellant's admitted involvement in the opening of
the Towerline bank account, his collection of the Sieva cheque and failure to
testify
would constitute proof beyond reasonable doubt of his participation in
the fraudulent scheme. Conversely, if there exists a reasonable
doubt concerning
Bagley's identification of the appellant, the appeal must succeed. For without
proof that appellant was the person
who collected the Sieva cheque, the
remaining evidence would be insufficient to justify a conviction,
notwithstanding his failure
to testify. Bagley's evidence therefore assumed
critical importance and, not surprisingly, was subjected to rigorous scrutiny
and
vigorous attack on appeal before us.
Bagley was employed at the relevant time as a senior receptionist at
ESCOM. The person normally responsible for the handing over of
month-end cheques
to those who called for them was a Mr Niek Venter ("Venter"). She assisted him
on 29 September 1987 because he
was very busy that day. She testified
10
that at approximately 13:45 the
appellant arrived and requested the
Sieva cheque. She stated that
she had never seen him before. He
spoke to her in English. She was
initially unable to locate the
cheque. She recalled that she had
looked up at the appellant on
several occasions while searching for
the cheque and had asked him
more than once to spell the name Sieva.
She eventually asked
Venter where the cheque was. He explained to
her where to find
it. She located the envelope containing the cheque
and gave it to
Venter, who in turn handed it over to the appellant.
According to
her evidence the whole episode took about two minutes.
She
claimed that the appellant was wearing a light grey suit. On
29
October 1987, exactly one month later, she pointed him out at
what,
on the evidence, was a properly constituted identification
parade.
She testified that she was able to identify the appellant by
his grey
hair, his face, his eyes, his height and his build. Bagley
was also
able to give a detailed description of the person who came
and
11
collected the Powerlines cheques. She was adamant
that the person
concerned was not Hempel.
Bagley was subjected to a searching cross-examination.
The
trial magistrate (who delivered a comprehensive and
well-reasoned
judgment) found her to be an "excellent witness". He
went on to
say:
"She has been shown to be exceedingly observant and has described each of
the two recipients of the cheques in minute detail. She
had seen the two persons
in broad daylight from close proximity in circumstances demanding more than just
a casual glimpse of them.
In respect of the SIEVA recipient, she looked up at
his face on a number of occasions and was able to remember the gist of their
discussion.
The court finds that she had sufficient opportunity of making a proper
and reliable observation of the person who came to uplift the
SIEVA envelope and
cheque and that her evidence is reliable in this regard."
These findings by the magistrate cannot lightly be ignored on appeal,
bearing in mind that he had the advantage of seeing the
12
witness and hearing her testify.
It was known to the ESCOM officials later that same
afternoon that the Sieva and Powerlines cheques had
been collected by unauthorised persons. The probabilities are that Bagley would
immediately have recalled the occasions and made a mental note of the appearance
of the persons concerned, thereby standing her in
good stead to point the
appellant out as one of those persons at the subsequent identification
parade.
Bagley's evidence is at variance with Venter's description of the person
who collected the Sieva cheque as "'n langerige persoon,
blas in kleur", a
description which clearly does not fit the appellant. That is as far as Venter's
evidence went. He stated categorically
that he would not be able to identify the
person concerned. Nor was he able to give a description of the person who
collected the
Powerlines cheques. It was of course Bagley, not Venter, who dealt
with the recipient of the Sieva cheque. Venter did no more than
13
hand over the cheque. His opportunity for
observation was limited, which would detract from the reliability of any
description given
by him. The trial magistrate was very much alive to this
difference between Venter's evidence and that of Bagley. He appears to have
approached Venter's evidence with some measure of justifiable scepticism. He
held that Venter was clearly not as observant as Bagley,
and that she
"outclassed" him as a reliable witness in all material respects. On a careful
reading of their evidence I am unpersuaded
that the magistrate erred in his
assessment of the two witnesses, and that Venter's evidence in any way detracts
from Bagley's identification
of the appellant.
It is common cause that the appellant is not entirely fluent in English
and speaks with an Italian accent. Yet Bagley described the
person who collected
the Sieva cheque as "Engelssprekend" and added (referring to the English
language) "Hy het dit goed gepraat".
It was argued that she was either not as
observant as she
14
claimed, or that her evidence in this regard
raised a doubt as to
whether the person concerned was the appellant.
One must,
however, view her evidence in its proper context. All that
was said
by the person she identified as the appellant was "Good
afternoon,
I am here to collect a cheque for Sieva", and thereafter he
spelt
"Sieva" a few times. The following passage in her evidence under
cross-examination puts the matter in perspective:
"En as ek reg onthou het u 'n verdere opmerking ook gemaak,
u het gesê hy het 'n goeie Engels gepraat? - Dit het vir
my
goed geklink ja.
Soos 'n Engelssprekende persoon? — Wel die woorde wat hy
gepraat het sou ek sê hy kan Engels praat ja en verstaan.
Mevrou ek bedoel soos iemand wat Engels vanuit huis praat,
'n Engelssprekende persoon? — Wel dit kan ek nie sê uit
die
paar woorde wat ons gewissel het nie.
Maar u is bereid om te sê dit was 'n goeie Engels op die
paar
woorde? — Ja."
Having regard to the limited conversation between them, the impressions
formed by Bagley are not necessary inconsistent with the person
who spoke to her
being the appellant.
15
It was also argued that it was reasonably
possible that Bagley had observed the appellant on a previous visit by him to
ESCOM and
sub-consciously transposed the two occasions. There is no merit in
this argument. It is not in dispute that the appellant and Hempel
went to ESCOM
on 7 September 1987 and signed the visitors register. The purpose of their visit
was apparently to see a certain Rheeder.
In the normal course their visit would
have taken them to the reception area where Bagley worked.
Non constat
that Bagley, who was not the only receptionist, would have been there at the
time, or would necessarily have observed them. Bagley
denied any recollection of
seeing the appellant on that occasion, although she admitted that she may
possibly have seen him. If she
did, he clearly made no firm or lasting
impression on her, and this incident could not have accounted for her subsequent
identification
of him. Apart from this, it was never suggested to Bagley under
cross-examination, in order to gauge her reaction, that she may have
16
transposed the two occasions.
Hempel
testified that he collected the Powerlines cheques from ESCOM on 29 September
1987. However, he does not by any stretch of
imagination fit the description of
the recipient of those cheques. If he did fetch a cheque, it must have been the
Sieva cheque.
For, on a proper conspectus of the evidence, the recipient of the
Sieva cheque could only have been the appellant or Hempel. One
may ask why
Hempel, against his own interests, would admit to collecting a cheque if he did
not do so? The answer probably lies in
the fact that Hempel is a totally
unreliable and discredited witness whose motives cannot be fathomed.
Significantly, Hempel never
mentioned fetching a cheque at ESCOM in his original
statement. It is true that Hempel was never present at an identification parade.
But in court he and the appellant were seated next to each other when Bagley
pointed out the appellant. She could hardly have mistaken
the one for the other.
It was never
17
pertinently put to Bagley under cross-examination
that Hempel might have been the recipient of the Sieva cheque. She might have
convincingly
refuted any such suggestion. There is in my view no merit in any
argument which suggests that Bagley may have confused the appellant
with
Hempel.
It was further argued that it was improbable, in all the circumstances,
that the appellant would have exposed himself to the risk
of identification by
fetching the Sieva cheque. Minardi had previously done sub-contracting work for
ESCOM. The appellant had probably
in the past collected cheques from ESCOM on
Minardi's behalf. He would have been known to certain of ESCOM's officials. He
had visited
ESCOM on 7 September 1987. Why then choose to fetch the cheque
himself when he could have sent Hempel to do so? There may have been
various
reasons for his doing so. If he knew the situation from past experience he was
probably better equipped to achieve his purpose
without attracting
18
undue attention. He may have believed that his
absence from the country for quite a long time reduced the likelihood of his
being
recognised. Or it may simply not have entered his mind at the time that he
was in any real danger of being observed and caught. One
cannot speculate for
what reason he might have decided to fetch the cheque. The improbability of his
doing so, however, is not sufficiently
strong to otherwise detract from Bagley's
positive identification of him.
It is true that in his original statement Hempel did not incriminate the
appellant. It was argued that what he said immediately after
his arrest was more
likely to have reflected the truth than his later statement and evidence.
Whether Hempel avoided any reference
to the appellant originally because he
feared him (as he claimed in evidence) or because he wished to protect him, it
is perfectly
clear that he deliberately refrained from making any mention of the
appellant. In the statement he tells how he
19
was introduced to one Gordon, who professed to be
an attorney, who accompanied him to Volkskas Bank on the occasion when the
Towerline
account was opened. It is common cause that the person who actually
accompanied him was the appellant, but Hempel falsely withheld
that fact. Hempel
is a person on whose word little if any reliance can be placed. His initial
failure to ascribe to the appellant
the role he subsequently did does not
justify any inference in the appellant's favour.
The appellant did not seek to gainsay Bagley's evidence. There was
therefore less reason to doubt her reliability than might otherwise
have been
the case. The absence of any rebutting testimony from the appellant, whatever
the reason for such absence,
ipso facto
tends to strengthen the direct
evidence of identification given by Bagley
(S v Mthetwa
1972(3) SA 766(A)
at 769D-H). In all the circumstances I am unpersuaded that the magistrate erred
in holding Bagley to be a reliable
witness and accepting her evidence.
20
As previously mentioned, it was conceded that if
Bagley's evidence was correctly accepted the appellant's appeal must necessarily
fail. The opening of the Towerline bank account was a very important component
of the whole scheme. The appellant was present on
that occasion. I do not find
it necessary to traverse the evidence of the witnesses Roos and Ferreira.
Suffice it to say that it
is quite apparent from Roos's evidence, which the
magistrate accepted, that the appellant played a prominent role in the opening
of the account. Coupled to this is the fact that the appellant collected the
Sieva cheque as well as his failure to testify. The
only reasonable inference to
be drawn (leaving aside Hempel's evidence) is that the appellant was knowingly a
party to the fraudulent
scheme. He was accordingly correctly convicted.
The magistrate went further and held that Hempel's evidence that the
appellant masterminded and planned the execution of the crimes
was substantially
the truth. Earlier in his judgment he had
21
said of Hempel:
"It has to be stated without more ado that he was not a satisfactory witness
by any stretch of imagination. He is a self-confessed
liar, an accomplice in the
matter and a person who suffers from an impairment of his memory. It is obvious
that it would be extremely
dangerous and fatal to rely on [his] uncorroborated
evidence. If no corroboration or other safeguards can be found for the core of
his version the court would have to hold that it can place no meaningful
reliance on his evidence. The court will and can only rely
on those portions of
his evidence where it has been corroborated by other reliable evidence,
circumstantial evidence or the probabilities
in the
matter."
He accordingly sought, and found, corroboration
of Hempel's evidence in relation to this aspect in the evidence of Bagley, Roos
and
the defence witnesses Fletcher and Language.
In my view it would be extremely dangerous to place reliance on any
aspect of Hempel's evidence. Hempel is clearly not as naive and
unworldly as he
would have one believe. He has held relatively responsible positions in the
construction industry and there
22
was even a time, according to the evidence, when
the appellant worked under him. Roos's evidence showed that the appellant played
a prominent role in the opening of the Towerline account; Bagley's that he
fetched the Sieva cheque. Those acts establish that he
was a party to the
fraudulent scheme; they do not necessarily point to his masterminding it. Nor
does the evidence of Language and
Fletcher do so, neither of whom positively
link the appellant to the scheme. Many of the aspects of the scheme were carried
out by
Hempel alone without the apparent presence or assistance of appellant -
the registration of Towerline, the opening of a number of
bank accounts, the
depositing of cheques and the withdrawal or attempted withdrawal of monies. We
only have Hempel's word for it
that he did so at the behest of the appellant. He
did not claim, on his arrest, to have been acting on anyone else's instructions.
The appellant was not found in possession of any incriminating evidence relating
to the scheme from which an inference could be drawn
as
23
to the role he played. There was probably at
least one other person involved in the scheme. The precise extent of his role
remains
obscure. It may well be that the appellant, by dint of past experience
and greater intellectual capacity, was better equipped to
devise and carry out a
scheme of this nature than Hempel. But even though the probabilities may suggest
that the appellant was the
mastermind, it cannot be held beyond all reasonable
doubt that he was. By the same token it cannot be found, as the magistrate did,
that the appellant manipulated and abused Hempel to the extent that the latter
merely acted as a pawn on his behalf. The appellant
and Hempel should therefore
have been treated as equal perpetrators in the commission of the
crimes.
This brings me to the question of sentence. Hempel was given a totally
suspended sentence; the appellant was sentenced to an effective
four years
imprisonment. The primary reason for this disparity was the rinding, which I
have held was not justified, that
24
the appellant had masterminded the scheme, had
abused Hempel to achieve his own ends and was responsible for Hempel landing in
prison
and being left with a criminal record. The magistrate found that Hempel
had not gained financially from the nefarious scheme; there
is no evidence to
show that the appellant did. The R25 000-00 lost by Volkskas Bank was drawn by
Hempel, and what became of it we
do not know. Appellant, like Hempel, is a first
offender. The offences were serious and the potential loss great. The crimes
were
well planned and executed. Yet in reality there was little chance of the
scheme ever achieving complete success.
It may well be that the mitigating factors which operated in Hempel's
favour were greater than those favouring the appellant. But
they were not such
as would justify a significant difference in their sentences. Our courts strive
as far as possible, to achieve
parity of sentence in instances of equal or near
equal participation in the same crime. In this respect it was said in
S v
Marx
25
1989(1) SA 222(A) at225B-C that:
"As 'n algemene beginsel poog ons howe om sever doenlik gelyke deelname aan
'n misdaad eenvormig te straf, tensy die betrokke misdadigers
se uiteenlopende
persoonlike omstandighede ongelyke vonnisse regverdig. Dit is belangrik dat by
vonnisoplegging geregtigheid nie
alleenlik moet geskied nie, maar duidelik moet
blyk te geskied, nit die oogpunt van sowel 'n beskuldigde as die publiek.
Ongelyke
strawwe op gelyke misdadigers ten opsigte van dieselfde misdryf druis
teen die algemene gevoel van geregtigheid in (Du Toit Straf
in Suid-Afrika op
118)."
We arc called upon, in view of the magistrate's
misdirection, to consider the question of sentence afresh. Hempel's sentence may
have
been too lenient, and the appellant may be deserving of a higher sentence.
But it would in my view be inequitable, given the circumstances
of this matter,
to require the appellant to serve a prison sentence when Hempel's sentence was
fully suspended. The appellant is
now in his mid-fifties. He has started a new
and seemingly stable life for himself and his family in Port Elizabeth. Hopefuly
he
has learnt from his experience. The sentence that will
26
hang over his head should aid his rehabilitation.
The appellant's appeal against his convictions is
dismissed.
The appeal against sentence succeeds. The
appellant's sentence is
altered to read:
"Five years imprisonment wholly suspended for five years on condition that
the accused is not convicted of fraud or theft, or any
offence of which theft is
an element, committed during the period of
suspension."
J W SMALBERGER JUDGE OF
APPEAL
VIVIER, JA) concur HOWIE, JA)